William Polk: We need to reduce the American empire

The announced topic of my talk to you today is not exactly what I want to discuss with you. For me to tell you what I would advise the incoming American president to do about oil is not so useful. Most of you could do a better job of that than I. If such advice is not coals to Newcastle, it is worse: “oil” to London. So let me cast my net somewhat more widely. I begin with one of our national weaknesses.

We Americans have a tendency to offer solutions before we know what we are trying to solve; so with your permission I want to set out quickly what I see to be the problems we face and then offer my take on what we can do about them. To do this, I have to discuss politics, strategy and money on the one hand and on the other what might be termed the mind-set of America, Europe and the westernized elites we have spawned since the Second World War.

So consider first politics, strategy and money.

Already in the administration of President Harry Truman, the American government made a fundamental decision with which we have lived ever since and which today constitutes our greatest problem: under the threat of the Cold War, we moved to militarize our economy. As he was leaving office, President Dwight Eisenhower categorized the emerging result as the “military-industrial complex.” Under Presidents John F. Kennedy and Lyndon Johnson, this process was carried forward in the Vietnam war and a new dimension was added with the space program.

The things America built to sell –- consumer goods -- decreased while those we gave away -- military items – increased.

By the early 1960s, American industry was no longer competitive in many civilian goods. I saw why when as a guest of the Japanese government I visited such Japanese factories as Toshiba and Canon. What I had expected to see was that the Japanese were able to out-produce America in cameras, electrical equipment and other consumer goods by using cheap Asian labor. What I saw was quite different: the Japanese did have cheaper labor but they were benefitting even more from skilled management, aggressive salesmanship and intelligence.

Meanwhile, since American industry was increasingly selling to the government, often with no-bid and cost-plus contracts, management and salesmanship were of declining importance. Many major corporations had become almost adjuncts of the defense establishment.

Soon well-known American consumer products were little more than American packages wrapped around Asian components.

This skewing of the American economy had both a domestic effect -- there was less secondary and tertiary economic benefit to what we were doing -and an international effect -- we were importing more and exporting less so we got accustomed to an adverse balance of payments.
Perhaps even more important, we allowed our infrastructure to run down. The American Society of Civil Engineers reported (and I quote) “America’s infrastructure over all is close to ‘failing’ [and]…that an investment of $1.6 trillion will be needed to bring it up to working order. According to the report, nearly 30 percent of the nation’s 590,750 bridges are ‘structurally deficient or functionally obsolete [and] The number of unsafe dams has risen by 33 percent to more than 3,500 [while]…aging wastewater management system discharge billions of gallons of untreated sewage into US surface waters each year.’” Year by year, the American government has spent less on these basic things.

At least as important, the private sector, aiming for relatively short term profits and increasingly dependent on military sales, allowed industrial plants to degrade. No one has yet guessed what making Ford or General Motors again competitive would cost. Those companies now want the Federal Government to bail them out.

Apart of these trends, government policy also had a fiscal dimension: President Ronald Regan decided that America should so challenge the Soviet Union that we would force it into bankruptcy. What he set out to do, the Russians also did to themselves in their disastrous war in Afghanistan – their Vietnam. But the cost to America was also large. Americans like to think that we “won” the cold war, but actually, by any rational calculation, both America and Russia lost the cold war.

In the 1990s, a powerful new element in this pattern was brought forward by the neoconservative movement. They pushed the idea that America uniquely had a role to play everywhere in the world. We would remake it to fit our image. And the men and women in this movement became the principal guides to President George W. Bush. The Iraqi war was the product of their new ideology. And it spawned a series of other moves and military actions – what they called “the Long War” -- with which we live today. It is conveniently laid out in the 2005, 2006 and 2008 “National Defense Strategy of the United States of America” which proclaim (and I quote) that “We are a nation at war” and that we intend to secure “access to key regions, lines of communication, and the global commons” by defeating “adversaries at the time, place, and in the manner of our choosing ...” The policy has resulted in the creation of nearly one thousand American military bases worldwide and large scale American interventions in Afghanistan, Iraq, Somalia and Pakistan and the prospect of an attack on and perhaps invasion of Iran. In addition we now have teams of semi-clandestine special operations forces active in perhaps twenty other countries.

Let me just focus on the monetary aspects of this movement. Today, we have a military budget larger than all the other countries of the world combined. The published figure is nearly 700 billion dollars but the real figure will be higher. The Iraq campaign will have cost, by the end of this fiscal year, about one trillion dollars in direct, Congressionally approved, expenditures -- even that figure does not include equipment; so by the accounting of the Defense Department to Congress, American troops must be fighting bare-fisted and on foot. Much more significant are other figures. Economists Joseph Stiglitz and Linda Bilmes have estimated that the overall costs to the American economy are probably three trillion dollars. Some economists believe the true figure may be double that. I think they are right. Consider the just the cost of caring for the wounded – the government admits to 25,000 but just in this year alone some 300 thousand are in treatment and the overall figure is probably more than half a million. Just caring for them over their lifetimes will cost one trillion dollars. And this does not take into account the “opportunity costs” of the loss of their productivity.

Keeping one soldier – or one mercenary -- in Iraq or Afghanistan, not including his equipment, costs half a million dollars a year.

The bottom line of this half century of growing militarism of America is that today we are spending 58 percent of all discretionary revenues of the federal government on the military. That is to say that the American military budget is larger than that of all the other countries of the world combined and larger than all other domestic expenditures.

Now, on top of these expenses has come the financial crisis. It has been so much in the news that I do not need to dwell on it except to point out that it has two dimensions – first, the cost of the bailout, say three quarters of a trillion dollars and, second, the decline in the ability to pay for it by lower productivity, unemployment and the psychology of depression.

So, at a time in which we needed to be able to pump money into the economy, we were very short of money. You know the figures. Our national debt, even before the financial crisis had gone up to 10.6 trillion dollars and the Treasury had borrowed about three trillion dollars abroad. The government borrowed twice as much in 2008 as in 2007, up from 550 billion to about one trillion. Now, of course, those figures are much worse. And while we do not yet have firm figures, the gross national product, adjusted for inflation, must have increased only slightly. This, very briefly, is what I see as the monetary challenge.

There is a second aspect of the challenge that is harder to quantify: it is the way in which Americans have approached issues and the make-up of the forces with whom we deal.

From the German army, America in particular inherited “war gaming.” As modified by mathematicians, mainly at MIT, the so-called politico-military gaming rested on the notion that all issues were ultimately governed by “rationality.” That is to say, all governments would see the world in essentially the same terms regardless of their cultures, religions, mores, pride or historical memories and riches or poverty. So we did not need to understand the world in all its complexity.

We were encouraged in this view by two things: the first was the Cuban Missile Crisis when we assumed that the Russians saw the issue in the same or similar terms to us. We thought they did and that is the lesson we drew from the crisis. Now we know that what really happened was more complex. I had been a member of the Crisis Management Committee and later had four meeting with my Russian counterparts at the Soviet Academy of Sciences; so I had some perspective on how shallow had been our understanding of how and why the Russians reacted as they did. But the events seemed to justify a disembodied and “rational” approach to the world. In my writings on the current crisis with Iran, I have shown how dangerous this approach can be.

The second factor that skews our approach to world affairs – and this may be of direct consequence to each of you – is that most of the governments the American government deals with are staffed by men and women who are graduates of our system, speak our language and think in the same or similar terms to us. We did not need to listen because we all speak the same language and think the same things we learned in the same schools.

Both of these experiences -- our dealings with the Europeans and our dealings with the so-called Third World -- have misled us: we are now learning that many of our assumptions were built on sand. Some countries, notably Iran now, do not share our view of the world predicament and therefore are unlikely to respond in the terms we expect. Some other governments that do respond in the ways we expect may have lost contact with their own people and so are increasing fragile. This was true of Iran. There despite the world’s highest rate of economic growth and a huge military and security apparatus, the relatively small westernized governing elite lost contact with the people and was overthrown. A similar disconnection is becoming an issue in a number of other countries such as Egypt and India where the quest for statistical growth favors small westernized minorities while shunting aside the mass of the people. Trying to get the maximum growth out of limited resources means that the traditional parts of the societies are allotted just enough to dampen revolutionary danger. Figuring out how to do this has proven very difficult for quasi-denationalized governments which are under pressure to modernize and increase their financial growth. Doing so is likely to lead to a turbulent period ahead of us.

So, what would I urge upon the incoming president?

In summary, it is to scale back to a sustainable and much more modest role for America. Few empires have been destroyed on the battlefield and America is in no danger of that. But many have been destroyed by going bankrupt and America is certainly in danger of that.

Let me now tick off the major headings:

First, let us be realistic. There are no quick fixes. The incoming president cannot just flick a switch and repair the damage that has been done. He must prioritize and he must move fast on the really essential. He has only a few months of relative freedom before bureaucratic inertia sets in and he has limited resources. His first priority must be where the money is.

The Department of Defense which has metastasized across the whole spectrum of the federal government and, as I say, is now channeling 58 percent of all disposable revenue and is planning to ask for an additional 3 to 5 percent. The president must resist this move and, insofar as is feasible, bring America back from the binge we have been on. We need to be more modest. In American politics today, it is the military to whom most Americans listen – you saw that in General Colin Powell’s intervention last week. So listen to another: One of the best Marine Corps officers put it simply: “It used to be said that the side with the most guns won; today, the side with the most guns goes bankrupt.” That is roughly where Americans are today. We must realign our actions to fit our real needs and our actual means. As one of our most sober military analysts, Colonel Andrew Bacevich, put it, “America doesn’t need a bigger army. It needs a smaller – that is, more modest – foreign policy…Modesty implies giving up on the illusions of grandeur to which the end of the Cold War gave rise.” Public opinion polls indicate that 8 in 10 Americans agree.

Specifically and as a first step, the incoming president should begin by repudiating the neoconservative-inspired “National Defense Strategy of the United States of America.”

This direction of march implies that we should get out of Iraq and Afghanistan. These are complex moves. I won’t try to lay them out here as I would need several hours to do so, but, from my experience of planning American policy for the Middle East, I have produced a costed-out and mutually-reinforcing series of steps in a carefully articulated plan in a book called Out of Iraq. One aspect of the plan is the financial savings – between 350 and 500 billion dollars.

What to do about Iran? It is the most discussed issue in America after the state of the economy.

Our policy there has been a failure. We have not been able to resolve the Iranian crisis by threats and cannot hope to do so. In one of his many parables the great Greek political commentator, Æsop, told us why: the harder the storm buffets a person, the tighter he draws his cloak around himself. Under threat of our storm, Iranians, no matter how they feel about their government, will rally around their “cloak,” their flag. This comes into focus on the nuclear issue.

On the nuclear issue which, from my personal involvement in the Cuban Missile Crisis, I particularly worry about, we missed the opportunity to get a moratorium on nuclear weapons; instead we multiplied what we had to fantastic numbers, 30-40 thousand when a dozen would have blown up most of the world. The result was that China followed, then Israel plus South Africa, then India and Pakistan against one another, then North Korea. . But we are selective. Those powers that have managed to acquire weapons are now accepted members of the “club” but we do not want new members.

Now we are on the brink of a new “surge.” We are again building bombs and upgrading those we already have. And we are urging India, for example, to forge ahead down this dangerous path.

This is exactly the opposite of what we need to do. Since nuclear weapons anywhere are a danger to people everywhere, the incoming president should begin the process to curtail and ultimately abolish these weapons.
To convince other nuclear powers to follow this path toward real security. we must begin with ourselves, agreeing with the other major nuclear power, Russia, on the program we originally set out in the 1960s or something similar to it, thus setting an example. Such a program will call for a high level of diplomacy and will not be easy. But if we want our children and grandchildren to live in a reasonably secure and peaceful world, they are necessary. Moreover, we know how to accomplish it. Incentives already exist and we can create others.

Iran has our attention now so we could move positively in the Middle East. There, instead of convincing the Iranians by our statements and our actions that they need to acquire weapons to deter us, we need to push for a regional nuclear ban.
At the present time, Israel is the only nuclear power in the Middle East. Would it block such a move? Perhaps, but there are reasons why it might be willing to follow our lead. The first reason is that Israel does not need nuclear bombs. Their value to Israel is psychological rather than strategic. They were not used in the 1967 or 1973 wars or in the Lebanese war of last year. Israel already has the most powerful army and air force in its neighborhood. The second reason is that it has a de facto American security guarantee. But the most compelling reason, the third, why Israel should move toward a nuclear free zone is its own security. Its possession of nuclear weapons ensures that some of its neighbors will get them; so nuclear weapons, far from being a source of security, are a source of insecurity. In a decade or so, no matter what happens in Iran, other Middle Eastern countries will acquire them. So it would be smart for the Israelis to take the leadership in removing them from the Middle East. We can help in various ways and the incoming American president should do so.
We must get serious about the environment. What we have done so far is little more than a PR happening. But if we do on the environment what we did on space travel in the Apollo program or with the Manhattan Project on the nuclear bomb in World War II, we could save our planet. It is, after all, the only one we have. The incoming president will have little money at least initially to move on this issue but he can work with the states, many of which do have the beginnings of effective policies, and the president can reallocate some already committed funds and offer new tax incentives. He should. The program will be popular because among other things, if it is sensibly designed, it will create new jobs whereas now we are losing about 100 thousand a month.

Here, perhaps, is the time to introduce the energy issue. We built America into the world’s largest user of energy -- about 25% of the total. Our cities were designed around the automobile powered with cheap fuel. We probably cannot remake our cities, but the incoming American president will be under great public pressure to cut down on imported energy. However, Americans will not support moves to cut back on consumption. Balancing these two imperatives will require almost the wisdom of Solomon. I think his only three hopes are shifting the emphasis toward public transportation, better means of saving energy and pushing hard toward alternative sources. These moves will not be easy and may impact in detrimental ways in your industry, but they are certainly going to happen for better or for worse. We all – the incoming president and you -- should try to make them as beneficial and as least disruptive as possible.

More Comments:

Gerald Morine -
11/4/2008

This comment was meant for another paper. Somehow it became attached to this one, and I don't see any way for me to delete it. Sorry!

Gerald Morine -
11/4/2008

The author proposes standard Democratic stuff that FDR and LBJ might have also proposed. Nothing wrong with it, spoils of election victory, I guess. I doubt they will have much economic effect, except stimulating inflation a bit.

I would like for us to learn more about the causes of the present financial lock-up before more "remedies" are prescribed, however. I'm afraid the tycoons and hedge fund managers will soon be back at it, "innovating."

I admit to not getting to the foreign policy parts. Israel and Iran really are complicated topics. I think they deserves their own postings.